Delta Air Lines Looks to Extend Reach into Japan

Almost a year after Delta Air Lines acquired the floundering Northwest Airlines in October 2008 to form the largest airline in the industry, the company is again looking to expand its scope with investement in Japan Airlines Corp (JAL).  

According to NHK and Kyodo, Delta is in negations to become the top shareholder of JAL, which has experienced a steady downward decline in revenue over the past two years. Struggling to keep its head above water, the company is currently restructuring itself under the anxious scrutiny of the Japanese government, which recently backed 100 billion yen credit to the company. As evidence of this possible future acquisition, the Japanese media have cited news Delta and JAL were talking about code-sharing on international flights.

Following a reported 50.9 billion yen operating loss for the year up to March 2009 and a 59 billion yen loss for the currently year, a merger or acquisition may be the only way for the JAL to continue operations.

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